The local digital radio multiplex service licence for Manchester was
awarded to CE Digital Ltd on Thursday 3 June 1999, to run for twelve years from the date
the service commences broadcasting.

Applications were invited on 17 December 1998. By the closing date of
13 April 1999, one application was received, from CE Digital Ltd, an equal joint venture
between Emap Radio Ltd and Capital Radio plc.

Copies of the non-confidential section of the application were made
available for public inspection at Manchester Central Library and at the Authoritys
office in London. A notice was issued on 13 April 1999 inviting public comments on the
application. Under the terms of section 51(2) of the Broadcasting Act 1996, when
considering whether, or to whom, to award a local digital radio multiplex licence, the
Authority must have regard to the following specific matters:

the extent of the coverage area as proposed by the applicant;

the timetable relating to achievement of the proposed coverage area and the start of
broadcast services;

the ability of the applicant to establish the proposed service and to maintain it
throughout the period for which the licence will be in force;

the extent to which the digital programme services proposed to be included in the
service would cater for the tastes and interests of persons living in the area and, where
it is proposed to cater for particular tastes and interests, the extent to which those
services would in fact cater for those tastes and interests;

the extent to which any proposed digital sound programme services would broaden the
range of programmes available by way of local digital programme services in that area and,
in particular, the extent to which they would cater for tastes and interests different
from those already catered for by local digital programme services already provided in
that area;

the extent to which the application is supported by persons living in the area; and

whether, in contracting or offering to contract with persons providing digital programme
services or digital additional services, the applicant has acted in a manner calculated to
ensure fair and effective competition in the provision of such services.

The Authority is also required to take account of any representations
made in respect of the application.

Consideration of the application

Coverage area and timetable

Members were satisfied with the applicants proposals for the
roll-out of coverage, with an initial two transmission sites (at the Sunley Building in
Manchester city centre and Winter Hill) to be implemented from the commencement of
services in May 2000. There would be some further extension of coverage using a third site
at Sutton Common at a later stage, when digital receiver penetration in the region reaches
16% of households which, according to the applicants own predictions, would be in
2005.

Ability to establish and maintain the service

The applicant is a joint venture between the two largest operators,
in terms of market capitalisation, in the commercial radio industry. The Authority had no
doubt about CE Digitals ability to establish and maintain the service proposed in
the application.

Catering for tastes and interests of people in the area

The commercial programme services proposed by the applicant are as
follows:

Other services
Classic Rock and Sport (provided by Talk Radio UK Ltd/Guardian Media Group plc)
Xfm  Capital Radio plc - relayed from London (modern rock)
Kiss - Emap Radio Ltd  relayed from London (dance)

Members were pleased to note that following submission of its
application, in response to questioning by the Authoritys staff, CE Digital Ltd had
made a commitment to provide local programming of a minimum of local news and travel at
breakfast on Kiss and Xfm once digital receiver penetration had reached one-third of all
households in the Manchester area. Members also noted that in the event that CE Digital
Ltd is unable to reach a final agreement with any of the above-named proposed digital
sound programme service providers, a Hot New Country service (to be provided by Scottish
Radio Holdings plc) has been identified as the reserve programme format.

Broadening the range of local digital programme services

As there are no local digital programme services available in the
Manchester area, and as this was the sole application, this criterion was effectively
satisfied by default.

Local support

CE Digital supplied a limited amount of evidence of local support for its application. It
argued that local support for an application for a local multiplex licence is
more meaningfully measured by evidence of audience demand for the proposed programme
services.

Fair and effective competition

The Authority has no reason to believe that the applicant has not acted in a manner
calculated to ensure fair and effective competition when contracting or offering to
contract with potential or proposed service providers. In accordance with the licence
conditions pursuant to the Broadcasting Act 1996, the Authority will keep matters of fair
and effective competition and undue discrimination under regular review.